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Non-Budgetary control is laying control on your non-budgeted expenses i.e those expenses which are not defined in normal budgeted expenses. The techniques for these non-budgetary control are :
1) Statistical data analysis.
2) Break-even analysis or the no profit & no-loss analysis.
3)Gantt Charts
4) PERT (Programmed Evaluation & Review Technique).
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Budgetary control system?
Budgetary Control concerns itself with the total costs for each department. Each variance is the responsibility of the official who is in charge of the department in which it arises. This official must then explain the cause of the variance and take to prevent its recurrence.
6 Differentiate between Standard Costing and Budgetary Control?
Distinction Between Standard Costing And Budgetary ControlAlthough budgetary control and standard costing both are based on some common principles; both are pre-determined, comparison will be made with the actual costs and both system need a revision of the standards or the budget, these two systems have certain differences which are as follows: 1. Budgetary control deals with the operation of a department or the business as a whole in terms of revenue and expenditure. Standard costing is a system of costing which makes a comparison between standard costs of each product or service with its actual cost.2. Budgetary control covers as a whole in terms of revenue and expenditures such as purchases, sales, production, finance etc. Standard costing is related to a product and its cost only.3. Budgetary control is applicable to utmost all business organizations. Standard costing is applicable to manufacturing concerns producing standard products and services.4. Budgetary control is concerned with a specific period and is based on the totals of amounts. Standard costing is concerned with the standard costs, which are worked out generally per unit of production.5. Budgetary control is not based on standard costing system. Standard costing cannot exist in the absence of a budgetary control system.Posted Syeda Humaira Fatima
Need of budgetary control?
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What is a budget report used for?
1.Budget helps to know the future results, 2.budgetary control technique helps to compare the estimated results with actual results. 3.budgeting focuses on standards or objectives. 4.budget helps subordinates to to compare their performance with budgetary standards and can do self appraisal. 5.through budgeting managers can allocate resources to departments according to their budgetary allocation. 6.budget help to improve coordination between various departments. 7.budgetary control helps to use the principle of management by exception by giving more attention to departments where actual operations and target deviate from budgetary standards.
What steps can be taken to prevent budgetary slack?
budget slack can be prevented by good alignment between budgeting process and the organization's strategy which achieved by communication and coordination between top management and line managers or strategic business units to ensure that all line managers have the same perspective about achieving the organizational goals.good implementation of budgetary control also plays a role in preventing budgetary slack.
